The Accidental Superpower

by Peter Zeihan

  One of the few constants through human history is that when a resource—whether it be mineral, agricultural, labor, financial, or market—is in short supply, enterprising, capable, creative countries will go to great lengths to seize what they can for themselves. The Germans and Japanese were hardly the only countries that launched wars for regional domination to secure resources and markets. Africa’s modern conflicts—even in the post–Cold War era of free trade—are consistently fought over oil, diamonds, mines, and agricultural land. Over the broad swath of the British Empire, it is difficult to find a corner of the world that the British did not launch their military against to seize something they thought they needed. Egyptian history up to the 1950s is about the Nile’s agricultural capacity being harnessed by governments more capable than its own.

  Making matters worse, the population footprint of the world has evolved radically during the past seven decades. The largest culprit for the shift is the green revolution (not to be confused with the environmental movement), the large-scale application of energy, botany, fertilizer, steel, concrete, and irrigation technologies to the developing world. Recall the land quality map from chapter 4: Much of the green revolution was about making marginal lands—the “moderate difficulty lands” category—bloom.

  Collectively, these technologies—along with a massive application of capital—allowed vast regions of the world to become agriculturally productive. Bretton Woods enabled the industrial revolution’s agricultural applications to spread to the developing world, allowing the global population to quadruple during the twentieth century. The Boomer credit bulge has taken those applications to some of the most technologically backwards parts of the planet with similar results.

  But maintaining that population, to say nothing of growth, is impossible for most locations unless those inputs continue to be applied. The green revolution made deserts bloom and tropics productive, but those gains will only remain if the irrigation systems continue to irrigate and fertilizers remain on hand. Remove Bretton Woods, remove the Boomer capital surge, and everything about the green revolution and the populations it has created is cast into doubt.

  The wars of the not too distant future won’t so much be for glory or pepper, but in many cases for the ability to remain part of the modern world. Or simply to remain.

  America in the New Disorder

  The United States is immune to none of this, but it is heavily resistant to all of it. Its population is aging and so it too will face capital crunches, higher taxes, and higher calls on government resources. But America’s population is aging far more slowly than that of its competitors. At the time of this writing, the average American is already younger than his Australian, Canadian, French, German, Italian, Japanese, British, Russian, Spanish, and Polish counterparts. By 2020—just five years after this book’s publication—he will also be younger than the average Chinese.

  The younger population also means it is likely that the American market will be the only significant market to grow year-over-year throughout the period. But even if the American market plateaus—or, God forbid, shrinks a little—it will still represent the largest market in the world by a factor of three. And it is a market that, courtesy of shale, does not require substantial access to the broader international system to maintain its size, growth, coherence, or structure. Or even to keep the lights on.

  The United States is also the only country that still has prime lands that not only can be improved but are also likely to be. As the cost of capital increases in the aftermath of the Boomer tide going out, questions of feasibility will return to the fore. Those lower development costs of the Lower 48 territories east of the Rockies—and their colocation with large population centers—will prove a critical factor.

  And land isn’t the only thing that is both cheap and plentiful in the United States. Thanks to shale, American electricity will also be accessible, plentiful, and above all affordable. Cheap land and cheap power don’t simply mean more development, more industry, and a larger and more stable consumption base, they are also the magic elixir that allows young families to thrive. Family formation rates the world over are highest when the basics of life—housing, food, and power—are affordable and reliable. They will be most affordable, most accessible, and most reliable in the United States.

  As of 2008, only about 14 percent of U.S. GDP was wrapped up in imports. One-third of that, approximately 5 percent of GDP, was energy. In the past six years shale has already cut that segment by half, and will soon reduce it to zero. Another third of the total is trade with other countries in North America. That leaves under 5 percent of GDP for all other imports.

  The export portfolio is similarly favorable to the United States. As of 2013 only 10 percent of GDP is sourced from exports. North America absorbs over one-third of the volume, while including the rest of the Western Hemisphere increases the proportion to half. Canada alone takes more than the entire European Union, and much of the extrahemispheric remainder is with stalwart allies like Australia, the Netherlands, Singapore, and the United Kingdom.

  One of the secular trends that is driving down those remaining bits is colocation. During the Bretton Woods era, long and gangly supply chains were not a problem. The low-tariff world allowed manufacturing processes to use parts sourced from quite literally hundreds of different providers assembled at dozens of facilities. This is being undone at every level. Labor costs have increased by a factor of six in China in just ten years, sending manufacturers who used to see China as the promised land away in droves. Many are relocating much closer to their preferred American end market, with Mexico being a hot favorite. The high cost of transport fuels has similarly reduced not only China’s manufacturing dominance, but also international supply chains with multiple steps, wherever those steps might be. And new technologies like 3-D printing allow for the fabrication in a single run of complex components that used to be made of a dozen or more simpler parts.4 It all adds up to shorter supply chains, more focused on the high-value-added industries that the Americans already dominate, located closer to home, and in general less dependent upon other countries for everything from design to materials to replacements. Most hurt will be those economies less able to move up the value-added chain to justify their participation in such simpler—if technically more involved—processes: China, Cambodia, Peru, India, Bangladesh, Brazil, Ukraine, and Vietnam.

  The United States won’t just lose interest in global energy security, it will lose interest in global energy altogether. The United States won’t just lose interest in global trade supply-chain security, it will lose interest in global trade in its entirety. The only pressing need for the Americans to go beyond their shores will be to guarantee their own shipping, and with evolving technologies like shale and 3-D printing, shipping is already accounting for a shrinking, not growing, percentage of American GDP.

  Overall, Americans will be able to avoid the sort of Hobbesian, Darwinian environment that will develop, without the help of the rest of the world. Due to shale energy, Canadian energy, and Mexican energy, the United States will have all the petroleum and electricity it could need. The United States is the world’s largest agricultural exporter by a sizable margin, and Canada is no slouch. Due to the Midwest and Canadian Prairies, the United States has all the grains it could possibly need. Due to California’s Central Valley, Florida, and Mexico, it will even be able to produce sufficient supplies for most noncritical foodstuffs like citrus and vegetables. So while a global free-for-all may endanger American imports of exotic products like out-of-season avocados, Americans will actually be fairly comfortable compared to everyone else.

  As to what they will do with this relative security, wealth, and comfort… well, that is the question.

  The near future will not be a hegemonic world. Hegemons are defined less by their power than by their needs. In a hegemony, the superpower has a goal in mind and so takes an interest in managing events, imposing an order upon the system. The Cold War, for exam
ple, was a bipolar system run by competing hegemonies. The Americans maintained the free trade order and its associated military alliances in order to combat the Soviet Union, which crafted and upheld its own economic/military imperial structure.

  In the world to come, Americans won’t have much need for the rest of the world. And what needs they do have will be largely divorced from what they perceived as important in the period of 1946 through 2014. Without global needs or global interests, there is no reason to impose a global order.

  Disengagement will be the rule of the day. Trade links will wither. Global shipping will no longer be protected. Alliances will be allowed to atrophy. Countries long used to living under American protection will find themselves forced to act to keep the lights on, to keep their people employed, to keep their borders secure—and at best they will be out of practice. Other countries long used to being stymied by American security umbrellas will find themselves free to take action against their neighbors. Aside from a scant handful of strategic and economic allies that we’ll discuss in the next chapter, America’s primary means of interaction with the international community will be via its special forces and long-arm navy, which will use fast, discrete attacks to eliminate perceived threats or disrupt governments sufficiently unwise to attract the wrong kind of American attention.

  In the scramble for resources and markets and money, countries of all stripes will jump back into the great game of geopolitics, plotting, scheming, and maneuvering against each other. But for the most part they will not be plotting, scheming, and maneuvering against the United States. Being the target of someone’s ire or calculus requires that you have an interest that they can plot, scheme, or maneuver against. Since nearly everything that matters to the United States will be firmly anchored in North America, the Americans will return to the role that they played before World War II: a global power without global interests. No more guarding the Korean DMZ. No bases in Qatar. No Checkpoint Charlie. No patrolling the sea lanes. When it comes to the wider world, the Americans will just not care.

  Most days.

  Large-scale American disinterest in the broader world will be the rule of the day, yet the United States will remain the only country with substantial long-range military deployment options. It will have absolute dominance of the seas, but will only exercise that power when it sees fit. Unfortunately for anyone hoping to plan around American actions, the criteria for “when it sees fit” will not just be vague, but maddeningly mutable.

  Scared New World: The American Scenario

  This, all of this—the coming American divorce from the world at large, the demographic inversion and its impact on governments’ stability, the end of easy access to global energy supplies, the ongoing ability of the Americans to brutally interrupt any portion of the planet without suffering or caring about the repercussions—is actually the best-case scenario because it assumes that American interest in the wider world will continue to wane at a slow pace. It assumes that most countries will have at least a few years to adjust to changing circumstances.

  They might not get that. The reason is wrapped up in how geography shapes culture.

  Every culture has a certain personality impressed upon it during the first century or two of its existence as geography and history intermingle to shape exactly who the people in question turn out to be. The formative period for American culture was the pioneer era. Consider the time frame:

  While Napoleonic France was reintroducing Europe’s peasant armies to the horrors of war, famine, and massed relocations, American freemen were happily pushing west to settle some of the world’s best lands. Within a year of breaking ground, all could—via the world’s best maritime transport system—sell grain on global markets for hard currency.

  It is largely irrelevant that the Americans’ ability to collectively capitalize upon its advantages was due more to an unplanned confluence of unprecedented factors—the arrival of millions of Europeans anxious to escape Europe’s wars, the largely completed genocide of the natives, the ease of accessing the Ohio valley, the presence of the world’s best natural waterway network, the availability of the world’s largest contiguous piece of arable land—rather than some grand scheme. But such a phalanx of coincidences does not diminish one bit that the Americans’ frontier period was the largest and fastest cultural and economic expansion in human history. And it held for five generations: The Americans found more and better lands, serviced by more and better waterways. It may have been accidental, but it held for so long and was so core to the lives of so many Americans that as a national culture Americans came to think of such an upward trajectory as normal. Ordained even. God shed his grace on thee indeed.

  But what happens when things do not get better each and every year? What happens when the Americans suffer a stinging, public setback? What happens when the rest of the world reaches out and touches Americans on terms other than America’s?

  They panic. They panic with the desperation of a people who have no sense of balance, no perspective, no understanding of context, no sense that not everyone in the world wins every time. And then they fight back with everything they have. Were the United States a small country such overreactions would be odd, perhaps even comical. But the United States is the global superpower and its overreactions typically reshape both itself and the wider world.

  • Sputnik. The Soviet Union’s beeping aluminum grapefruit convinced the Americans that they had already lost the Cold War, despite the fact that they were ahead of the Soviets in electronics and metallurgy and led the greatest economic and military alliance in world history. The Americans revamped their scientific research and educational systems and retooled their industry on a mass scale. They created organizations like NASA and DARPA that sixty years on still rule the horizons of space.

  • Vietnam. The Americans lost a postcolonial war to a rice producer, and fell into a national funk despite the fact that the United States was the world’s largest rice exporter at the time, it wasn’t their colony, and that not one American ally abandoned the alliance because of the defeat. The American reaction to Vietnam was the mass application of information technology to warfare, which landed them with everything from satellite communications to cellular phones to cruise missiles.

  • Japanophobia. In the 1980s Americans became convinced that the Japanese had—not would, had—overtaken the United States as the global economic superpower. This belief permeated despite American naval forces still protecting global shipping, despite having an economy double the size of Japan’s, despite Japan’s total arable land being roughly the size of Massachusetts, and despite American forces occupying Japan at the time. America’s reaction included the mass application of technology across industry to “catch up” to Japan, as well as Wall Street’s at times brutal punishing of firms deemed too slow. The resultant capital formation funded, among other things, the Internet revolution of the 1990s.

  • September 11, 2001. The attacks on New York and Washington, D.C., claimed some three thousand lives, making them the worst terror attack in history. A response—a very strong response—was warranted. But leaving aside the wars in Iraq and Afghanistan, few realize just how far the Americans pushed into the global system. As a side effect of American military actions in the Global War on Terrorism, the Americans now have solid defense cooperation, up to and including the ability to share local tactical intelligence, deploy special forces, and operate with minimal restrictions against militants, within Morocco, Algeria, Tunisia, Libya, Egypt, Jordan, Saudi Arabia, Oman, Bahrain, Iraq, Kuwait, Israel, the Philippines, Indonesia, Singapore, Kenya, Ethiopia, Djibouti, Kyrgyzstan, the United Kingdom, Italy, Spain, Portugal, Poland, Hungary, Romania, Bulgaria, and Turkey. That places, at a moment’s notice, the sharp end of American power on either side of nearly all of the world’s major trade and energy arteries.

  America’s geography grants it nearly endless riches, security, and opportunity. What it does not necessarily grant the Americans is the wisdom
to appreciate what they have or make the most of what lies before them. Between the strategic and economic environment of the current day, America’s insulation from the wider world, and above all the United States’ trademark unpredictability, picking out precisely what will cause the Americans to pull the plug on the free trade era is an exercise in wild-eyed futility. Unfortunately for everyone else, it truly matters whether the American shift from Bretton Woods occurs slowly over a decade of neglect, or deliberately in a single day of panicked fury. The new world may well emerge just as the United States rose to power just over a century and a half ago.

  By accident.

  CHAPTER 9

  Partners

  Who’s Who in the Disorder

  In my speaking engagements, I essentially present the first eight chapters of this book in the first twenty minutes or so and then spend the rest of my time addressing the future from the point of view of my respective audiences. In the aftermath, the Q&A sessions can take us anywhere. What about Azerbaijan’s efforts to resist Russia? What is the future of Dubai’s financial sector? Will the Brazilian cotton industry survive? What parts of China’s manufacturing base are most viable? Will wheat production in Saskatchewan be able to find new markets? What are Sweden’s prospects in a post-euro world? What do you think of India? Will the aging state of U.S. infrastructure hobble American power? The list goes on. And on.

  And on.1

  In other words, I’m acutely aware that it’s a great big mess of a world out there, filled to overflowing with complex interactions. One of the greatest challenges in crafting this book—not to mention trying to forecast out to 2030(!)—was not so much deciding who and what to cover, but instead who and what to leave out. Everyone has a story, and everyone’s story impacts someone else’s, but I couldn’t tell them all. So in the remainder of this book I will endeavor to hit what I see as the key points of the future: